New England’s second-largest city, Worcester, Mass., rose to prominence during the Industrial Revolution on the strength of manufacturing, primarily of textiles. It also became something of an innovation hub: the monkey wrench, barbed-wire fencing, and the envelope-folding machine were invented there. Today, the city continues to be a leader in advanced manufacturing, information technology, and biotechnology, healthcare, and medical research.

Creating a place for workers in these industries to live and play has prompted a revisioning of the city’s core. “City planners and savvy developers understand the value of a more transit-oriented, higher-density, livelier pedestrian streetscape, so there is a strong movement to encourage downtown redevelopment,” says Marc Margulies, principal of Boston’s Margulies Perruzzi Architects. “Even the medical and research institutions understand the desirability of a successful downtown and are considering reasonable ways of encouraging and supporting urban multiuse residential and commercial growth.”

So far, public and private development projects totalling more than $2 billion are under way, and more investment may be on the way. “Outdated facilities and brownfields are being tackled to make room for innovative technologies,” says city director of economic development Timothy McGourthy. “We’ve submitted a number of projects for stimulus dollars, from bridge and road work to project-specific funding. We’re hopeful to hear soon about our success.”

POPULATION/EMPLOYMENT

175,521 residents; 2% annual growth for several years. April 2009 unemployment: 8.3%.

RESIDENTIAL MARKET

Current median home sale price: $219,940.

MARKET STRENGTHS

Easy access to Boston and Providence, R.I.

Nine universities and colleges

Low cost of doing business

MARKET CONCERNS

Sprawl outside city core

Need for larger commercial tax base

Economic uncertainty

FORECAST

“The city must continue the recovery of industrial brownfields, reduce urban flight, and bring additional housing and employment opportunities to the downtown area,” says native son Michael Pagano, president of Lamoureux Pagano Associates. “The city needs to build on the progress made over the last 10 years.”